[Zubersoft]

That is the nudge tool. If you tap an annotation to select it, then tap or hold on those arrows, it lets you make slight adjustments to the annotation's position (which can be difficult to do with a finger at the moment because there isn't magnification to show what's under your finger). If you don't need the nudge tool, or the toolbox, tap on the circle at the top left, and deselect the options you don't require.

Mike

UPDATE:
I was too slow! Geoff's answer is great.